2012 Stock Picks – Q1 Update

Along with a group of other top North American financial bloggers, I threw my hat in the ring again to see who could come up with the best stock picks for 2012.  We agreed to pick four stocks or ETFs and hold them for the entire year with no changes allowed.  Regular My Trader’s Journal readers know I’m not much of a buy and hold investor, so I added in how I’d play this contest if options were allowed also.  The results are not based on options, but on pure growth and dividends from our four picks.

I barely made it into the top half of the group through the first quarter.  I got stung by Google (GOOG) for a loss, but the rest have been OK and I doubt GOOG will stay down too long.  Bonds fell as expected and my leverage inverse pick (TBT) pick did well, but bonds have recovered some since their low and brought TBT lower again.  I think TBT has more room to rally as bonds will likely fall further through the rest of the year.  Small caps (UWM) hasn’t been a disappointment.  I’m up 25% on that pick alone.  GLD is my big fear as it appears to have room to the downside before recovering.  It’s still up for the year to date and by the end of the year it should be back up more, even if it corrects farther from its recent high.

This is how my four picks have done so far along with how my alternate options trades (which are not part of the contest) are working so far.

  • GLD – Closed 2011 at $151.99.  Closed 3/30/12 @ $162.12.
    • My original GLD June $165 put option has been a great trade so far.  At the beginning of the year it was estimated I could sell the contract for $18.00.  At Friday’s close it was trading at $6.40 which means I’m up about 8.6% (assuming I held back cash to support these option trades in case of assignment) so far while GLD is up 6.7%.
  • TBT – Closed 2011 at $18.06.  Closed 3/30/12 @ $20.45.
    • My original TBT June $18 put option has been good also.  I started with a pretend sell at $1.94.  On Friday it closed at $0.29.  This gives me a return so far of 10.3% versus the TBT gain of 13.2%.  I should’ve sold the put in the money and I’d be looking great now.  Either way, 10.3% isn’t a bad return for a quarter.
  • UWM – Closed 2011 at $34.86.  Closed 3/30/12 @ $43.76
    • My original UWM July $36 put option was also too conservative, but is doing well.  I estimated that I could’ve sold it for $6.50 to start the year.  It traded around $1.75 by the end of March.  This position is up 16.1% compared to UWM only which is up 25.5%.
  • GOOG – Closed 2011 at $647.07.  Closed 3/30/12 @ $641.24
    • My GOOG June $675 put option was more aggressive than my UWM put while it should’ve been reversed.  I figured I could’ve sold the put for $65.00 to start the year.  On Friday it was trading at $50.20.  While GOOG is down almost 1%, my put has decreased in value, giving me a pretend profit of 2.5% based on my cash reserves.  This is my worst pick, but even the stock is down I still have a profit on the option.

I barely made it into the top half of the group through the first quarter.  This is how everyone is doing in order of best to worst with the percentage gains so far this year.  Some of these links are to the current posts that went live today.  I’ll update the rest as I receive them from everyone.

  1. WhereDoesAllMyMoneyGo: 35.91%
  2. Intelligent Speculator: 16.37%
  3. DividendMantra: 13.71%
  4. TheWildInvestor: 11.78%
  5. MyTradersJournal: 11.17%
  6. BeatingTheIndex: 10.87%
  7. MillionDollarJourney: 7.84%
  8. PassiveIncomeEarner: 4.77%
  9. DividendGrowthInvestor: 4.43%
  10. TheFinancialBlogger: 0.10%

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